Chong and Pflugrath conducted a study of different audit report formats and their effects on the audit expectation gap. They investigated whether report length (long or short), the location of the audit opinion (at the start or the end), and plain language (instead of technical language) affect shareholders' and auditors' perceptions of the audit. They surveyed a sample of shareholders and auditors and concluded that the responses indicate that different report formats have only minor effects on the audit expectation gap.8
Required
(a) In your view, what should be contained in an audit report that conveys realistic explanations of the auditor's role and the assurance provided by the audit report?
(b) Do you believe that auditors are correct in dismissing users' expectations as "unrealistic"? Should auditors be trying to meet these expectations by rethinking their role and changing their approach?